The IT sector is making headlines owing to job cuts but JC Sharma, VC & MD, Sobha Developers, believe that this won’t impact the realty business of Bengaluru. He also says that the demonetisation pangs are long over. Edited Excerpts:

How is the traction that you are currently seeing ever since demonetisation? Has the weakness persisted or are you seeing a big revival in demand coming because the murmurs on the street seem to be indicating that demonetisation worries and pains are long gone?It is partially true. The impact of demonetisation primarily is no more being felt by the sector or by the customers as a whole. As far as the volumes are concerned, definitely they are on the increase and FY2017-18 should be a better year from the operational perspective than what it was in 2016-17. But still we have a couple of more acts to be implemented, primarily the RERA which most of the states yet to implement and GST where the land abatement and certain other clarifications are needed. I believe that post these two events the industry should get back into a growth path.

The headline for IT industry is bad with job losses and layoffs. IT companies are said to be going easy on doing fresh hiring. Could there be a structural downturn in your Bangalore property market?Again, it is partially true. There is no space (in Bangalore). Some of the companies are looking for up to 2 million square feet of commercial space to be absorbed and they are not getting the space. So while somewhere jobs are being lost, somewhere else some jobs are being created as well; it is not getting highlighted.

Real estate prices have not been going up for the last three, four years, interest costs are coming down and the overall ownership in my view it has reduced. Now with lots of incentives on the pricing front as well as on the interest front there is still huge demand which is going to be tapped.

We have been suffering from our own structural challenges. We had launched more number of projects collectively in 2013-14-15, we could not complete. We had our own cash flow problems and all such things ensured that the trust of our customers somewhere was dented. When we say that RERA is welcome, GST is welcome, demonetisation is welcome, we say in the context that all these things will augur well and then the way you see consumption of say all other items including four-wheelers at some point of time with affordable housing in place. Housing sector structurally has got into next gear and it can only grow from here onwards.

Your current business can be classified as pure affordable housing or low-cost housing. Why everyone is feeling excited about housing market is because there is a government incentive, thrust, focus towards low-cost housing.Under Prime Minister Awas Yojna, for up to 110 metre square carpet area they are giving 230,000 interest subvention benefit. 85% of our ongoing projects will qualify under mid-income group. So these houses are affordable.

So there are only 15% of the ongoing projects we will be calling them as HIG group category and these houses are around 60 to 70 lakhs rupees. Other products are being sold around one crores or so plus/minus.

It is the sentiment, it is the lack of clarity and some kind of fear psychosis. Many thinks that to buy a house you need to be extra cautious than even buying gold which does not yield any result. Hopefully this (mindset) will change.

The Street is expecting FY18 pre-sales to be about 2000 odd crore rupees. Do you think this is an achievable number?This is absolutely an achievable number. We hope to achieve this kind of number what Street has estimated.

So when you say that the market has moved into next gear, your guidance somehow is not moving into the next gear. If your business is moving into the next gear, the guidance should also have been very strong, why is that?From 1st May 2017 RERA has been enforced. But we have zero clarity except in Maharashtra where our ongoing projects are there. Now the customers are inquiring that whether this project will come under RERA or not, whether you will be covering us under RERA or not. We are trying to explain but then we are the seller. We are not the authority. We want government to clarify and come out with clarity whether it is our fault or whether it is the systemic fault which is putting some of the would be buyers away from taking a call and these are the reasons which we are highlighting that are affecting. We believe that the state governments and central government will come out with the clarity so that the companies who are complying with all the laws and who believe in to follow the RERA can market themselves beautifully and in a better meaningful manner.

Given that you have no planned launches in the next two to three quarters what the big projects that you plan to launch?We have planned launches in Pune, Chennai, Trichur, Bangalore and Mysore. In all these cities we are planning about three to four million square feet of new launches in this financial year.